Posted by: Financial Sith Lord | January 8, 2011

FBMKLCI Market Review for early 2011

The recent 3 days rally followed by a 2-day profit taking on the FBMKLCI in its first week debut for 2011 shows little on the actual direction of the market in general for this year’s quarter. With a resistance level at 1,580 and a support level at 1,520, its a long 53 points drop should it fail to breach the resistance. So far, it has been pushing the medium-term resistance line, creating pushing points on 3 specific days, first on the 14 Oct 2010, 10 Nov 2010 and last, being the most recent, on the 6 Jan 2011.

(Chart courtesy of ChartNexus)

Recent statement made by Bursa Malaysia’s CEO, saying that foreign investors are eyeing to invest in Malaysia is rather bold, coming from the host himself. Anyone can claim that foreign investors are eyeing Malaysian markets but the facts lies in the foreign investors themselves. One notable global Fund Manager, Mark Mobius, is twitting of Kazakhstan. It seems that he has in-depth knowledge of the corporate and business environment there.. Meaning… no Malaysia in his books!!

Other foreign investors that may seem keen on Malaysia are the Arabs. Now, there are not many Fund Managers from Arab countries as they are more of Direct Investors, usually not involving the equity and capital markets. They are real-estate investors with some interest in IT and banking. The ones that’s managing these Arabs funds are usually Europeans or Americans, and like Mark Mobius, their heads are not facing this direction.

All I can say is that, for those of you heavily dependent on the index, put your money in ASB or ASN. For those hard-core punters and speculators (like me!!), the FBMKLCI is not our benchmark, thus the market has substantial liquidity to sustain gains for secondary counters for the next quarter.

What say you?

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